A bipartisan group of more than a dozen state attorneys general is filing a lawsuit against social media giant TikTok on Tuesday. One complaint accuses the company of deceiving users and allegedly operating an app by claiming it is safe for children despite its addictive nature. Unlicensed money transfer business.
The states suing include the District of Columbia, as well as New York and California.
“Our lawsuit seeks to hold TikTok accountable for harming children in D.C.,” District of Columbia Attorney General Brian Schwalb said in an interview with CNBC.
Schwalb’s lawsuit alleges that compulsive use of TikTok poses a number of “serious” mental health risks to teens and children, including depression, anxiety, sleep deprivation, and body dysmorphia. It is claimed that
Schwalb called the app, which allows users to create, share and view short videos, “digital nicotine” and said TikTok is “deliberately trying to get young people addicted to its platform.”
He said the app was “causing great harm to an entire generation of young people”.
“In addition to prioritizing profits over children’s health, TikTok’s unregulated and illegal virtual economy allows the darkest and most corrupt corners of society to prey on vulnerable victims. ” Schwalb said. “The company knew what was going on and chose to ignore it. This lawsuit aims to put an end to the company’s illegal, deceptive, and predatory conduct.”
CNBC has reached out to TikTok for comment on the lawsuit.
More than half of 13- to 17-year-olds in the United States use the app. TikTok has over 1 billion active users worldwide.
Schwalb’s lawsuit alleges violations of Washington, D.C., consumer protection law, alleging that TikTok “employed algorithms and manipulative design features” to trigger dopamine bursts in sensitive brains and hook young users. It is accused of being.
“TikTok recognizes that its design features can make the app more addictive and keep users engaged for longer,” the D.C. Superior Court lawsuit argues.
“This may be good for business, but it has dangerous implications for children.”
The complaint also says the company introduced “two new and dangerous features” in 2019. These include a live streaming feature called TikTok LIVE and a virtual currency system called TikTok “coins.”
“TikTok is notable for its use of unlicensed virtual currency, Coin,” the complaint alleges. “Users can purchase coins to send virtual ‘gifts’ during LIVE sessions, which streamers can redeem for real money. TikTok promises these monetary rewards the more popular they are. By doing so, we are encouraging users to go LIVE.” [their] The contents should look like this: ”
According to the complaint, TikTok “earns substantial revenue” from the coins and charges up to 50% fees on each transaction.
The lawsuit alleges that the app’s virtual currency deposit and withdrawal process is a “virtual currency remittance system” that ignores D.C. law because it does not have the necessary money transfer company license.
“While LIVE, which includes both live streaming and gifting, currently has a minimum age requirement of 18 years or older, TikTok’s lax age verification measures create an incentive for U.S. minors to misrepresent their age to gain access.” Schwalb’s complaint alleges.
The complaint also alleges that LIVE’s designs, including coins and gifts, “enable other serious harm to minors, including sexual exploitation.”
“TikTok is fully aware that these features combine to create an environment in which children are often sexually exploited by users, but TikTok has made profits a priority. We chose to turn a blind eye,” Schwalb’s office said in a press release.
TikTok’s U.S. headquarters are in Los Angeles, but it also conducts significant lobbying efforts and has an office in Washington, DC.
The company recently announced a partnership with the NHL’s Washington Capitals hockey team, which will feature the TikTok logo on road game jerseys next season, the complaint says.
The lawsuit seeks to permanently ban TikTok from violating consumer protection laws and order it to pay restitution to users, along with civil penalties.
The lawsuits by Mr. Schwalb and other state auditing firms were filed separately in courts across the country., The situation comes at a dangerous legal moment for the China-based company, which is owned by ByteDance.
In September, TikTok’s lawyers argued in a federal appeals court that a new law that would ban the app by Jan. 19 unless ByteDance finds a non-Chinese buyer for the company violates TikTok users’ First Amendment rights. They argued that it was unconstitutional because it violated human rights. .
The bill passed both houses of Congress in April after lawmakers argued that the app posed a national security risk to the United States.
Specifically, he argued that the type of data China collects could be weaponized by America’s adversaries in Beijing if the two countries went to war.
The AG’s lawsuit is the latest in a series of civil lawsuits by state attorneys general targeting social media companies for allegedly harming children and other users of popular apps.
